Salesforce Stock Rose Despite Expected Slower Top-line Growth in Q4

Salesforce Stock

Salesforce Stock (NYSE:CRM)

On March 1st, after the market close, (NYSE:CRM) is expected to release its quarterly earnings results.

Consensus estimates put the company’s Q4 revenue at $7.99B and its EPS at $1.36, increasing 9.2% year-over-year, as demand rises as companies undertake digital transformation.

There is a slowdown in top-line growth as firms become more frugal. Still, the corporation has pushed the bottom line via cost-cutting and headcount reduction.

Recently, it became public knowledge that Twitter had communicated to Salesforce that while it continues to appreciate what the firm does, it does not need as much of that assistance as it has in the past; Twitter reduced the amount of its contract with Salesforce from $20M a year to $5M a year (in line with the highest level of its job cuts).

The results will likely be hampered by external variables such as currency exchange rates and a decline in the amount of money spent on software by small and medium-sized firms in response to uncertain macroeconomic conditions.

Salesforce stock has outperformed the market by an impressive margin over the last two years, with every quarter’s earnings and every year’s sales exceeding analyst projections.

Estimates for earnings per share have been revised 29 times higher and 4 times lower during the last three months. Thus far, revenue projections have had 8 upward changes and 28 lower revisions.

Due to recent business reorganization and activist investor activity, Morgan Stanley believes Salesforce might increase its earnings per share by 20% or more over the next five years.

According to a Citi analyst, ” fatigue ” exists for front office or customer relationship management software, which might restrict the upside for the term and the company’s first projection for fiscal 2024.

The stock price is up 21.6% year-to-date.

Salesforce stock has been covered by 53 analysts on Wall Street, with 27 of them giving it a Strong Buy recommendation and 12 giving it a Buy recommendation.

Featured Image: Pixabay @ RJA1988

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